Jerry S. Payne - Page 23

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          previously allowed by respondent combined with the claimed deductions       
          now conceded is as follows:                                                 

               Total Deductions Allowed by Respondent                                 
                                              1987           1988                     
               Business Deductions:                                                   
               Business Interest        $ 32,063            $ 32,598                  
               Depreciation/Lakeway          4,890          20,770                    
               Miscellaneous                 48,870         161,234                   
               Itemized Deductions:                                                   
               Mortgage Interest             15,965         27,397                    
               Taxes                           2,697          5,076                   
                        Total               $104,485       $247,075                  

          Deductions Still in Dispute                                                 
               For 1987 and 1988, petitioner still disputes respondent's              
          disallowance of the following business and itemized deductions              
          claimed on petitioner’s Federal income tax returns:                         

               Deductions Still in Dispute                                            
                                              1987            1988                    
               Business Deductions:                                                   
               Business Interest             $117,074       $37,024                   
               Bad Debt Deduction            22,826         --                        
               Miscellaneous                 27,135         21,318                    
               Itemized Deductions:                                                   
               Medical                  --                  16,321                    
               Charitable Contrib.            --              2,300                   
                         Total               $167,035       $76,963                   

          Additional Deductions Claimed by Petitioner and Still in Dispute            
               For 1987 and 1988, petitioner on brief, and without properly           
          raising such items, claims additional deductions, as follows:               






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